Retiring Soon? What Money Moves Should I Make as a Homeowner First?
Short answer: in the year before you retire, get your home’s finances in order on a timeline, audit your yearly housing costs, make a plan for your equity, weigh paying off the mortgage, and settle your estate. Your home is likely your biggest asset and your biggest recurring cost, so it deserves a plan. Here is a simple countdown.
Here is the direct answer: in the year or so before you retire, work through your home’s finances on a simple timeline. Audit what your home really costs each year, make a plan for the equity you have built, decide whether paying off the mortgage makes sense, and get your estate in order. For most people, the home is both the largest asset they own and the largest recurring bill they pay, and retirement changes how you fund it, from a steady paycheck to your savings. A little planning now protects both your comfort and your home. Here is a countdown you can actually follow.
What is the timeline before I retire?
Plan your income and your equity
Decide, with a financial advisor, when to start your retirement income streams, and look ahead at how your home fits. If your income may not comfortably cover your housing costs, this is the time to plan a backup, such as tapping home equity, considering a reverse mortgage, or weighing a downsize.
Financial advisor · your lender for equity optionsAudit your yearly housing costs
Your mortgage is only part of the picture. Property taxes, insurance, and upkeep can quietly rival a mortgage payment. Take stock now so rising costs never threaten the home you want to keep.
Insurance agent · tax professionalSet your withdrawal plan and budget
Work out how your savings will fund daily life, and decide whether paying off the remaining mortgage before retiring makes sense for you. Keep a separate cash reserve just for home repairs, so a surprise does not force a bad financial move.
Financial advisorGet your estate in order
Your home is likely the most valuable thing you will leave behind. Put the right documents in place so it passes smoothly to your heirs, and have an open conversation with them about your wishes for the property.
Estate attorneyHow can my home equity work for me in retirement?
Here is where your home becomes more than a place to live. If you have owned for a while, you have likely built substantial equity, and that equity can be a genuine retirement tool. This is the part I help with directly.
Turning what you own into flexibility
- Tap equity when you need it, to supplement income or cover a large expense without selling
- Consider a reverse mortgage, which can let eligible older homeowners convert equity into funds while staying in the home, covered in our guide on home equity options for seniors
- Downsize on your terms, selling a larger home and buying a more manageable one, potentially freeing up cash and lowering costs
- Weigh paying off the mortgage, which frees monthly cash flow, though draining your savings to do it can leave you cash-poor, so decide with your advisor
Each of these has real tradeoffs, and the right answer depends entirely on your situation. My role is to lay out the financing options clearly and honestly, so you and your advisor can choose what fits.
What housing costs should I plan for?
Do not let coverage renew unexamined. Premiums can rise over time, so it is worth reviewing your policy and comparing options with a licensed insurance agent before you retire. Remember that these costs flow into your monthly payment through escrow, which we explain in our guide on why a mortgage payment can go up.
Many places offer property-tax relief for older homeowners, such as freezes, exemptions, or deferral programs. These can save real money on a fixed cost, so ask a tax professional what you may qualify for and apply early.
Set aside a separate cushion just for home repairs, apart from your general emergency fund. A sudden roof or plumbing bill should never force you to sell investments at a bad time.
If you are a veteran heading into retirement, your service may open doors here too, from options for using your home equity to benefits and exemptions worth checking as an older veteran homeowner. You earned every bit of it. Let us review how your equity and your benefits can work together to make this next chapter more secure, and I will point you to the right professional for anything outside my lane.
This chapter takes a team, and I am one seat at the table. Your retirement income, withdrawal plan, and whether to pay off the mortgage belong with a financial advisor. Property-tax relief and any tax questions go to a tax professional. Wills, trusts, and passing on your home go to an estate attorney. Insurance goes to a licensed agent. My lane is the home financing, tapping equity, reverse mortgage options, and downsize or move-up loans, and I coordinate gladly with the rest of your team. Start that with our East Valley mortgage team.
Put your home on the retirement plan
Retirement changes how you pay for the home you love, so give it a plan before your last paycheck. Work the countdown: plan your income and equity a year out, audit your housing costs, set your withdrawal and payoff strategy, and settle your estate. Lean on the right professional for each piece, and let your home’s equity work for you rather than sit idle. When you are ready to look at equity, reverse mortgage, or downsizing options, start with our East Valley mortgage team, right here across the East Valley.
What money moves should a homeowner make before retiring?
Work a simple timeline: about a year out, plan your retirement income and how your home equity fits; around nine months out, audit your yearly housing costs; by six months, set your withdrawal plan and decide on the mortgage; and by three months, get your estate in order. Use the right professional for each step.
Can I use my home equity in retirement?
Yes, in several ways. You may be able to tap equity when needed, consider a reverse mortgage that lets eligible older homeowners convert equity to funds while staying in the home, or downsize to free up cash. Each has tradeoffs, so review the options with a lender and your financial advisor.
Should I pay off my mortgage before I retire?
It depends. Eliminating the payment frees up monthly cash flow, but draining your savings to do it can leave you cash-poor. The right choice depends on your full financial picture, so decide it together with a financial advisor rather than by a rule of thumb.
What housing costs do retirees overlook?
Beyond the mortgage, property taxes, insurance, and maintenance can quietly rival a monthly payment. Review your insurance rather than letting it renew unexamined, ask a tax professional about senior property-tax relief you may qualify for, and keep a separate reserve just for home repairs.
How do I pass my home to my heirs smoothly?
Planning ahead with an estate attorney can help your home transfer without a lengthy, costly probate process, using tools such as a will, a living trust, or a transfer-on-death deed where allowed. It also helps to talk openly with your heirs about your wishes for the property.
This article is for general educational purposes only and is not financial, tax, legal, investment, or retirement advice, and is not a commitment to lend. CrossCountry Mortgage and the author do not provide financial planning, tax, estate, or insurance advice; consult a qualified financial advisor, tax professional, estate attorney, and licensed insurance agent about your specific situation. General observations and statements attributed to third-party experts reflect a published article and are paraphrased for context; those individuals and their firms are not affiliated with and do not endorse CrossCountry Mortgage or the author. A reverse mortgage is a loan that must eventually be repaid, typically when the last borrower leaves the home; the borrower remains responsible for property taxes, homeowners insurance, and maintenance, and failing to meet those obligations or other loan terms could result in loss of the home. Reverse mortgages, home equity financing, and downsizing options have costs and risks and are not suitable for everyone; eligibility depends on age, equity, program guidelines, and individual circumstances, which vary and are subject to change. Not all borrowers will qualify, and getting pre-approved does not guarantee loan approval. Property-tax relief and estate-planning tools vary by state and locality. VA loan eligibility and benefits depend on individual circumstances. CrossCountry Mortgage is a private lender and is not acting on behalf of, or at the direction of, the U.S. Department of Veterans Affairs. Equal Housing Opportunity.
